25
Jul
11

cynicism justified

I had to take the day off from everything yesterday. For the first time in over a month I fired up the DVD player and watched movies, and talked to family and friends on the phone. It was my first vegetative day since the Summer Solstice.

I am back to work this morning researching the schools—this time with a money slant. Seems appropriate as the intransigent nimrods in Washington continue to erode worldwide confidence in the US economy. This morning gold is at an all-time high $1,616/oz; silver is at $40.37/oz. (The higher these numbers go, the lower investors’ confidence in the Fed’s fiat currency is shown to be.)

I’m prepared for a dishonest “solution” to the debt ceiling impasse to be enacted in Congress. If you followed the state government shutdown in Minnesota, you have already seen a harbinger of things to come in Washington.

In Minnesota the politicians are balancing the state budget on the backs of children.

They are delaying state payments to the schools into the next budget year. The Republicans met their pledge to create no new taxes, but have forced the state’s school districts to borrow heavily (and raise school taxes at the local level to cover the extra borrowing costs).

In addition, they decided to issue bonds on future payments to the state by the tobacco companies—more borrowing.

Last week a former Minnesota state finance director was interviewed on the radio and said that the annual tobacco money (which is to be paid in perpetuity) varies based on a formula that includes tobacco sales.

In other words, the state has a money incentive to keep sales up so their payoff from the tobacco companies (best seen as a rebate) remains high. Now that the politicians are mortgaging future tobacco payments, they have a bigger incentive to assure future growth of tobacco use, even to young people. They’ll have all that extra interest to pay to banks and bond holders.

There will be a duplicitous game played by the Washington politicians, just as in the wars on drugs and terror as well as the shameful Minnesota “solution.” With a showy hand they’ll do one thing to allay the credulous public, and with a hand hidden under the table they’ll do the opposite.

How stupid do these politicians think we are? Unfortunately, their cynicism seems to be justified.

۞

Groove of the Day 

Listen to Green Day performing “American Idiot”


5 Responses to “cynicism justified”


  1. 1 matt
    July 25, 2011 at 4:49 pm

    “We must not let our rulers load us with perpetual debt.
    We must make our election between economy and liberty
    or profusion and servitude.
    If we run into such debt, as that we must be taxed in our meat and
    in our drink, in our necessaries and our comforts, in our labors and
    our amusements, for our calling and our creeds…
    [we will] have no time to think,
    no means of calling our miss-managers to account
    but be glad to obtain subsistence by hiring ourselves
    to rivet their chains on the necks of our fellow-sufferers…
    And this is the tendency of all human governments.
    A departure from principle in one instance
    becomes a precedent for [another ]…
    till the bulk of society is reduced to be mere automatons of misery…
    And the fore-horse of this frightful team is public debt.
    Taxation follows that, and in its train wretchedness and oppression.”
    Thomas Jefferson – July 12th, 1816

  2. 2 abram
    July 25, 2011 at 6:45 pm

    Too late!

  3. 3 abram
    July 25, 2011 at 6:46 pm

    What’s Next?

  4. 4 matt
    July 27, 2011 at 6:43 pm

    Still watching this mess with interest. Kind of like a credit card holder telling their bank that they need to increase their credit card limit so that their credit score won’t go down, even though they are having trouble making their minimum monthly payment as is. Again, things that make you say, hmmm!

  5. 5 abram
    July 27, 2011 at 7:09 pm

    Check this out. $16 trillion the fed has loaned out to domestic and foreign institutions to save the world. This info would never have seen the light of day if it wasn’t for Ron Pauls demand for an audit on the fed. http://www.thedailybell.com/2729/GAO-Fed-Issued-US16-Trillion-During-2008-Crisis

    It kind of makes the public hooha over quantitive easing and the current debt ceiling seem farcical.


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